Group 1 - The consumer staples sector has identified oversold stocks, presenting potential buying opportunities for undervalued companies [1] - The Relative Strength Index (RSI) is a key momentum indicator, with stocks considered oversold when the RSI is below 30 [1] Group 2 - Major oversold stocks in the sector include Instacart (NASDAQ:CART), Coffee Holding Co., Inc. (NASDAQ:JVA), and 22nd Century Group Inc (NASDAQ:XXII) [2] - Instacart's stock has decreased approximately 18% over the past month, with a current RSI value of 29.3 and a 52-week low of $34.78 [3] - Stifel analyst Mark Kelley has maintained a Buy rating on Instacart, lowering the price target from $49 to $46, while the stock closed at $37.08 [3]

Group 1 - The consumer staples sector has identified oversold stocks, presenting potential buying opportunities for undervalued companies [1] - The Relative Strength Index (RSI) is a momentum indicator used to assess stock performance, with an RSI below 30 indicating that a stock is typically considered oversold [1] Group 2 - Major oversold stocks in the consumer staples sector include Instacart (NASDAQ:CART), Coffee Holding Co., Inc. (NASDAQ:JVA), and 22nd Century Group Inc (NASDAQ:XXII) [2] - Instacart's stock has decreased approximately 18% over the past month, with a current RSI value of 29.3 and a 52-week low of $34.78 [3] - Stifel analyst Mark Kelley has maintained a Buy rating on Instacart, lowering the price target from $49 to $46, while the stock closed at $37.08 after a 2% decline [3]

Core Insights - 2025 was a pivotal year for 22nd Century Group, marking the end of a multi-year restructuring and the beginning of strategic initiatives aimed at strengthening its leadership in tobacco harm reduction [1][5] Tobacco Harm Reduction - The company is committed to leading the tobacco harm reduction movement through science-based innovation and responsible commercialization of reduced nicotine content combustibles [2] - The proprietary VLN reduced-nicotine cigarette platform is the only combustible cigarette authorized by the FDA as a Modified Risk Tobacco Product, containing approximately 95% less nicotine than conventional cigarettes [3][9] Consumer Feedback and Market Response - Early feedback from consumers indicates positive reception of VLN products, with some reporting significant reductions in cigarette consumption, including one individual who reduced consumption by approximately 66% in just 12 weeks [4] Strategic and Operational Progress - The company has made significant progress in executing its strategic priorities, focusing on sustainable profitability and improving its long-term financial outlook [5] - Transitioning to higher-margin branded products, expanding VLN product distribution to nearly 2,000 retail locations across over 20 states, and implementing cost-reduction initiatives have contributed to operational efficiency [7] Regulatory Landscape - The FDA proposed a rule to establish a maximum nicotine content for cigarettes, which could reshape the combustible tobacco market and aligns with the company's focus on reduced-nicotine products [8] - The VLN products are specifically designed to meet low nicotine thresholds, supported by scientific research and FDA authorization, highlighting the strategic relevance of the company's harm-reduction platform [9] Outlook for 2026 - As the company enters 2026, it aims to leverage regulatory momentum, consumer awareness, and its differentiated product portfolio to create long-term value [10]

Core Viewpoint - 22nd Century Group, Inc. is a leader in nicotine harm reduction in the tobacco industry, focusing on helping smokers manage their nicotine consumption through innovative products [3][4]. Group 1: Company Overview - 22nd Century Group is recognized as a pioneering company in the tobacco sector, dedicated to reducing the harms associated with smoking and nicotine addiction [3]. - The company has developed the VLN® cigarette, which contains 95% less nicotine than traditional cigarettes, providing smokers with a familiar option to control their nicotine intake [4][5]. Group 2: Product Details - The VLN® cigarette is designed to help smokers significantly reduce their nicotine consumption while maintaining an authentic smoking experience [4]. - The proprietary non-GMO reduced nicotine tobacco blends are created using patented technologies that regulate nicotine biosynthesis, ensuring full flavor and high yield with significantly lower nicotine content [5]. Group 3: Upcoming Events - The management team, including CEO Larry Firestone and CFO Dan Otto, will present at the Needham Growth Conference on January 16, 2026, and will be available for virtual one-on-one meetings [1].

Core Viewpoint - 22nd Century Group, Inc. is advancing the fight against smoking-related health harms through its VLN reduced nicotine content products, which have been authorized by the FDA as a Modified Risk Tobacco Product [1][4]. Group 1: Product and Market Impact - The VLN reduced nicotine content cigarettes have been shown to lower daily nicotine consumption by 40% over 12 weeks in a study with over 400 participants, indicating their potential to reduce smoking rates and increase quit attempts [2]. - Approximately 28.8 million smokers in the U.S. contribute to over $600 billion in annual healthcare costs related to tobacco harm, highlighting the significant market opportunity for VLN products [2]. - VLN cigarettes contain 95% less nicotine than conventional cigarettes, providing a non-addictive alternative for smokers [3][10]. Group 2: Regulatory and Strategic Developments - The FDA originally authorized VLN combustible cigarettes in December 2021 for a five-year period, with a renewal application filed for December 2026 [3]. - The company is expanding its range of VLN branded products and tobacco plant varieties to offer smokers more low-nicotine alternatives, aligning with the FDA's proposed guidelines for low nicotine [5]. - The renewal process is part of the company's ongoing research and development efforts to advance reduced nicotine content in tobacco and introduce additional VLN products [5]. Group 3: Company Vision and Leadership - The CEO of 22nd Century Group emphasized that the FDA's MRTP authorization for VLN cigarettes represents a forward-thinking approach to reducing smoking-related health harms, focusing on behavioral and social aspects of nicotine addiction [4]. - The company aims to empower smokers to take control of their nicotine consumption through its innovative VLN products, positioning itself as a leader in the tobacco harm reduction movement [8][9].

Summary of 22nd Century Group Conference Call Company Overview - **Company**: 22nd Century Group (Ticker: XXII) - **Industry**: Tobacco harm reduction - **Focus**: Pioneering nicotine harm reduction products, specifically VLN (Very Low Nicotine) branded products aimed at reducing nicotine addiction among smokers [1][2] Core Points and Arguments - **Transition Phase**: The company is moving from a debt-laden turnaround phase to a product launch and growth phase, indicating a positive shift in business strategy [2] - **Nicotine Epidemic**: The CEO highlighted a global nicotine epidemic, comparing its scale to the COVID pandemic, emphasizing the need for effective nicotine reduction solutions [2][4] - **Product Offering**: The VLN cigarette is presented as a solution to nicotine addiction, allowing smokers to reduce their nicotine intake while maintaining the smoking ritual [4][6] - **Target Market**: The company targets the 70% of the 28.8 million U.S. smokers who wish to quit, equating to approximately 20.5 million potential customers [5][8] - **Unique Selling Proposition**: Unlike traditional nicotine replacement therapies (NRTs), VLN products allow smokers to adjust their nicotine consumption without losing the smoking experience, which is crucial for habit change [6][8] Business Developments - **Inventory and Distribution**: Initial store inventories are being loaded, with some stores already reordering products. The company is also exploring cross-marketing opportunities [7][8] - **Financial Position**: The company is now debt-free and has received a $9.5 million insurance settlement, providing sufficient cash to sustain operations into 2026 [9][12] - **Growth Strategy**: The focus is on moving away from low-margin contract manufacturing operations to more profitable branded products [9] International Expansion - **South Korea Market**: Plans for a rollout in South Korea are currently on hold until the U.S. market is fully optimized [10] Marketing and Customer Acquisition - **Cost Efficiency**: Customer acquisition costs are low, primarily involving retail placement and minimal marketing expenses. The company is implementing promotional strategies to encourage product trials [13] Future Outlook - **Break-even Target**: The company aims to break even in the first half of 2026, with expectations of covering cash flow by that time [12] Additional Notes - **Website Functionality**: The company’s website (tryvln.com) is operational and provides updated information on product availability [11] - **CEO's Closing Remarks**: The CEO expressed optimism for the future and gratitude towards shareholders, indicating a positive outlook for 2026 [15]

Core Insights - 22nd Century Group, Inc. is a leader in the tobacco harm reduction movement, focusing on reducing nicotine addiction through innovative products [3][4]. Company Announcement - The CEO, Larry Firestone, will present at the Emerging Growth Virtual Investor Conference on December 10, 2025, at 3:55 PM Eastern Time [1]. Technology and Products - The company has developed proprietary non-GMO reduced nicotine tobacco plants that contain 95% less nicotine than traditional tobacco [4]. - The flagship product, VLN cigarette, is designed to provide traditional smokers with a familiar alternative while significantly reducing nicotine consumption [5]. - VLN cigarettes are the only low nicotine combustible cigarettes authorized by the FDA in the United States [6]. Investor Engagement - Investors can register for the conference online and submit questions in advance for consideration during the event [2]. - An archived webcast will be available for those unable to attend live [2]. Contact Information - Investor relations contact is Matt Kreps, reachable at investorrelations@xxiicentury.com or by phone at 214-597-8200 [8][9].

Core Insights - Emerging Growth Research released a quarterly update report on 22nd Century Group, highlighting a cash-rich balance sheet, full debt repayment, and a $9.5 million insurance settlement, along with a stabilized Contract Manufacturing Operations (CMO) [2][6] Financial Performance - 22nd Century Group fully repaid all remaining debt and settled a $9.5 million insurance-related legal case, resulting in a strengthened net cash position [6] - Q3 2025 revenue was $4.0 million, indicating stabilization after restructuring and the impact of a 2024 CMO price hike [6] - Gross profit declined to $(1.1) million due to increased excise taxes, despite improvements in per-unit margins [6] - Operating loss improved year-over-year to $(3.2) million as SG&A expenses were reduced [6] - Adjusted EBITDA remained stable at $(2.6) million compared to previous quarters [6] - Net cash increased to $14.0 million in Q3 2025, up from $(0.8) million in Q2 2025 [6] Strategic Outlook - Management is confident in achieving EBITDA breakeven by Q3 2026, driven by a higher-margin CMO mix and expansion of VLN® products [6] - The rollout of VLN® continues, with state registrations covering nearly all U.S. states and initial shipments underway [6]

Financial Data and Key Metrics Changes - The company reported a net revenue of $4 million in Q3 2025, a slight decrease from $4.1 million in Q2 2025, with total cartons sold dropping to 517,000 from 779,000 [34] - Gross profit was a loss of $1.1 million in Q3 2025, compared to a loss of $0.6 million in Q2 2025, reflecting lower volume and a transition to higher margin products [34] - The company ended the quarter with $4.8 million in cash and a $9.5 million receivable from an insurance recovery, increasing total assets to $32.4 million from $21.7 million at the end of 2024 [33] Business Line Data and Key Metrics Changes - The company is transitioning from a low-margin CMO business to higher-margin branded products, with shipments of newly branded VLN and partner VLN products totaling approximately 6,000 cartons year-to-date [30] - Natural style cigarettes contributed an additional 14,000 cartons to the total shipments, indicating a shift in product mix towards higher-margin offerings [30] Market Data and Key Metrics Changes - VLN and partner VLN products are now available in approximately 1,500 stores across 21 states, with authorization in about 40 states, which is crucial for expanding distribution [31] - The company expects to see rate of sale metrics in early 2026, which will provide insights into marketing effectiveness and consumer adoption [31] Company Strategy and Development Direction - The company aims to support the FDA's low nicotine mandate by positioning its VLN products as a solution for tobacco harm reduction, emphasizing the importance of both full nicotine and low nicotine offerings [22][26] - Future plans include licensing arrangements to allow other tobacco companies to adopt VLN products, thereby expanding market reach and supporting public health initiatives [21][22] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving EBITDA break-even by the second quarter of 2026, despite current challenges in sales metrics [39] - The company has successfully restructured its operations and is now focused on growth, with a well-funded balance sheet to support future initiatives [27][28] Other Important Information - The company has become debt-free and improved its balance sheet significantly, allowing for growth capital to be directed towards advancing VLN products in the market [27] - The management team has entered into customary employment agreements with key executives to support the company's growth trajectory [38] Q&A Session Summary Question: What are the plans for the $14 million in cash going forward? - The company plans to use the cash for operations, advancing VLN in the market, and initiating R&D and CapEx in early 2026 [36] Question: What is the current share equivalent of outstanding warrants? - There are just under 7 million shares outstanding, with a fully diluted basis of 23.7 million shares [37] Question: What is the impact of the Needham sales agreement on SG&A going forward? - The sales agent agreement will not change the current G&A level, as it is just formalizing terms for executive officers [37] Question: Is the company still targeting EBITDA break-even by the second quarter of 2026? - The company is still driving for that target and remains optimistic about achieving it [39]

Financial Performance - Net revenues for Q3 2025 were $4,011, a decrease of 32.5% from $5,946 in Q3 2024, primarily due to shifts in product mix [149]. - Gross profit for Q3 2025 was a loss of $1,059, compared to a loss of $588 in the prior year period, reflecting an increase of 80.1% in gross loss [150]. - Total operating expenses for Q3 2025 decreased to $2,153, down 22.8% from $2,789 in Q3 2024, driven by lower sales, general and administrative expenses [149]. - Operating loss from continuing operations for Q3 2025 was $3,212, a slight improvement from a loss of $3,377 in Q3 2024 [150]. - Net loss from continuing operations in Q3 2025 was $3,763, with a basic and diluted loss per share of $1.06, compared to a net loss of $3,585 and a loss per share of $848.84 in Q3 2024 [150]. - For the nine months ended September 30, 2025, net revenues were $14,050, a decrease of 31.0% from $20,361 in the same period of 2024 [151]. - Operating loss as a percentage of net revenues for Q3 2025 was 80.1%, compared to 56.8% in Q3 2024 [150]. - Total product line revenues for the nine months ended September 30, 2025, decreased to $14,050 million, a decline of $6,311 million compared to the prior year [153]. - Filtered cigars net revenues for the nine-month period ended September 30, 2025, decreased to $3,704 million, reflecting lower volumes and a shift towards higher margin products [153]. - Gross loss for the third quarter of 2025 was $(1,059) million, representing 26.4% of net revenues, compared to a gross loss of $(588) million or 9.9% in the prior year [154]. Cash Flow and Liquidity - The company had $4,846 in cash and cash equivalents as of September 30, 2025 [149]. - Cash and cash equivalents increased to $4,846 million as of September 30, 2025, compared to $4,422 million at December 31, 2024 [165]. - Working capital from continuing operations increased to $12,711 million as of September 30, 2025, up from $1,790 million at December 31, 2024, an increase of $10,921 million [166]. - The company incurred negative cash flow from operations of $(10,472) million for the nine months ended September 30, 2025, compared to $(9,947) million in the prior year [168]. - Cash provided by financing activities decreased to $10,746 million for the nine months ended September 30, 2025, down from $13,349 million in the prior year [171]. Expenses and Cost Management - Research and development expenses for Q3 2025 were $193, down 19.6% from $240 in the prior year period [150]. - SG&A expenses decreased by $698 million for the three months ended September 30, 2025, and by $2,048 million for the nine months ended September 30, 2025, primarily due to headcount reductions [155]. Business Outlook and Risks - The company expects to incur additional losses until it can generate significant revenue and profit in its tobacco business, raising substantial doubt about its ability to continue as a going concern [163]. - There have been no material changes to the information set forth in the Annual Report on Form 10-K for the year ended December 31, 2024, indicating stability in financial reporting [179]. - The company evaluates new accounting pronouncements to assess their potential impact on financial statements, ensuring compliance with accounting standards [180]. - There are no off-balance sheet arrangements as defined by Regulation S-K, indicating a straightforward financial structure [181]. - The company has not reported any material changes regarding market risk disclosures since the last annual report, suggesting consistent risk management practices [182]. Warrants and Shareholder Information - As of October 31, 2025, the company has 11,422,790 warrants outstanding, with the largest portion being 9,460,661 August 2025 warrants at an exercise price of $1.97, expiring on August 27, 2030 [176]. - The amended October 2024 PIPE warrants total 1,391,765, with no specified exercise price, expiring on July 15, 2030 [176]. - The company has implemented anti-dilution protection provisions for its warrants, allowing for cashless exercise options that could result in the issuance of two shares for no additional consideration [177]. Sales Performance - For the third quarter of 2025, cigarette volume increased to 345 cartons, reflecting additional CMO cigarette customers, while total cigarette sales decreased due to contractual price increases [153].